CYPRUS Trends and Developments Contributed by: Constantinos A Adamides, Scordis, Papapetrou & Co LLC
Factual findings In the present case the following (non-exhaus- tive) facts were proved before the Court or were otherwise admitted by the parties. • The Russian Applicant Company is a com- pany registered in Russia pursuant to Russian law. • The main activity of the Russian Applicant Company is the investment in securities. • The Russian Applicant Company was regis- tered in Cyprus as a foreign company with a place of business in Cyprus, pursuant to Section 347 of Cap. 113 on 6 April 2017. The place of business was an address in Nicosia (the “Nicosia Address”). The Russian Appli- cant Company never paid any local taxes to the Municipality of Nicosia pursuant to the applicable laws. • The Nicosia Address was and still is the address of a Cypriot group of companies which provide corporate (fiduciary) services (the “Corporate Service Provider Group”). • Many companies being members of the Corporate Service Provider Group have the Nicosia Address registered as their registered office. • In 2022 the registered address of the place of business of the Russian Applicant Company (the Nicosia Address) was changed to an address in Limassol (the “Limassol Address”). The Russian Applicant Company never paid any local taxes to the Municipality of Limassol pursuant to the applicable laws. • The Limassol Address is the address of a flat forming part of a residential building. • At the time of filing the court application, the director of the Russian Applicant Company was a Russian national residing in Moscow. Subsequently, the director of the Russian Applicant Company was another Russian national residing in Moscow.
• At the time of registration of the Russian Applicant as a foreign company, YM was registered as an authorised person of the Russian Applicant Company in Cyprus. The address for correspondence was the Nicosia Address. Later in 2022, YM was substituted by a Latvian national as the new authorised person of the Russian Applicant Company. • YM was a director of a number of companies being members of the Corporate Service Provider Group. YM was an employee of the Corporate Service Provider Group. • The Registrar of Companies did not conduct any inspection in order to determine whether the Russian Applicant Company carried on any business activities in Cyprus before regis- tering it as a foreign company with a place of business in Cyprus. • The Russian Applicant did not file any docu- ments pursuant to Section 350(1) and (2) of Cap. 113 (eg, financial statements) which are required to be filed by foreign companies hav- ing a place of business in Cyprus. The Court’s conclusions Citing Alekseyevich, the Court noted that the burden of proof is on the Russian Applicant to prove residence in Cyprus. On the basis of the above, the Court concluded that there was nothing to suggest that the Rus- sian Applicant Company carried on any business activity from Cyprus (from the Nicosia Address) (Aktiesselskabet Dampskib “Hercules” v Grand Trunk Pacific Railway Co [1912] 1 KB 222 and South India Shipping Corp Ltd v Export-Import Bank of Korea [1985] 1 WLR 585; Adams (op. cit.). The Court further stated that YM is an employ- ee of the Corporate Service Provider and not a director or an employee of the Russian Appli-
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